[Federal Register Volume 59, Number 63 (Friday, April 1, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-7766]
[[Page Unknown]]
[Federal Register: April 1, 1994]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-33815; File No. SR-Phlx-94-13]
Self-Regulatory Organizations; Notice of Filing of Proposed Rule
Change by the Philadelphia Stock Exchange, Inc. (``Phlx'') Relating to
Regulation 2 (Foods, Liquids and Beverages)
March 25, 1994.
Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''), 15 U.S.C. 78s(b)(1), notice is hereby given that on March
10, 1994, the Philadelphia Stock Exchange, Inc. (``Phlx'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'' or ``S.E.C.'') the proposed rule change as described in
Items I, II and III below, which Items have been prepared by the self-
regulatory organization. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Phlx, pursuant to Rule 19b-4 of the Act, proposes to amend Phlx
Regulation 2 (Foods, Liquids and Beverages) to permit the ability of
the respective standing floor committees to relax prohibitions
contained in this Regulation without filing a proposed rule change
pursuant to section 19(b)(2) of the Act. The Exchange proposes to amend
Regulation 2 as follows:\1\
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\1\With respect to the following amendment, italicizing
indicates new material.
Regulation 2--Foods, Liquids and Beverages Foods, liquids and
beverages are prohibited on the trading floor and the lower level
areas adjacent to the trading floor, except for the lunchrooms.
Any provision of this rule may be waived for a specific period
of time by the chairperson of the appropriate floor standing
committee or his designee.
1st Occurrence..................... Official Warning.
2nd Occurrence..................... $100.00
3rd Occurrence..................... $200.00
4th and Thereafter................. Sanction is discretionary with the
Business Conduct Committee
session.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of and basis for the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of these statements may be examined at
the places specified in Item IV below. The self-regulatory organization
has prepared summaries, set forth in sections A, B, and C below, of the
most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
Regulation 2 (Food, Liquids and Beverages) is a regulation of order
and decorum adopted pursuant to Phlx Rule 60.\2\ Rule 60 (Assessments
for Breach of Regulations) permits Exchange officials and Floor
Officials to assess fines not exceeding $1,000 for violations of
regulations pertaining to the administration of, and order, decorum,
health, safety and welfare on the Exchange, or to refer such violations
to the Exchange's Business Conduct Committee where higher fines or
other sanctions may be imposed, in accordance with Phlx Rule 960. Rule
60 also enumerates the procedural aspects of order and decorum fines,
including the ability to contest a fine and request a hearing. The
Exchange has adopted seven regulations of order and decorum pursuant to
Rule 60, including Regulation 2.
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\2\Regulation 2 prohibits food, liquids and beverages on the
trading floor and the lower level areas adjacent to the trading
floor (except for the lunchrooms).
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As originally adopted, Regulation 2 governs eating and drinking on
the floor. As conditions respecting Exchange facilities, the number of
member organizations' personnel employed on the trading floor and order
flow patterns continually change, the Exchange believes that a
procedure for waiving the prohibitions contained in Regulation 2 is
necessary. Eating and drinking, under this proposal, would be permitted
on any trading floor, upon determination by the chairperson, or his
designee, of the appropriate floor standing committee. Any waiver of
the prohibition must be for a specified period of time and would
require prior notice to the trading floor; reinstituting the
prohibition would also require prior notice.
The Exchange believes that incorporating a waiver procedure into
Regulation 2 is more efficient than continually amending Regulation 2,
which requires a filing with the Commission pursuant to section 19(b)
of the Act. Such a filing would not raise new issues, because it would
merely be specifying which floors, or parts thereof, prohibit eating or
drinking. Often, the Exchange's reasons for either permitting or
prohibiting eating on a particular trading floor may be time-sensitive
such that the delay inherent in the preparation and filing of a 19(b)
proposal may obviate the need for the change. The Exchange believes
that the proposed language is preferable to permitting eating and
drinking floor-wide, because eating and drinking may affect order and
decorum on the trading floor, and thus, trading. The Exchange also
believes that this proposal is preferable to filing repeated proposed
rule changes, which would be repetitive and expend staff time. Because
the impact of the proposal is limited to floor personnel, the Exchange
does not believe that notice other than to the trading floor would be
necessary.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Phlx Rule 60, because the regulation of eating and drinking on the
trading floor is necessary to ensure health, safety and decorum. The
Exchange also believes that the proposed rule change is consistent with
section 6 of the Act in general, and in particular, with section
6(b)(5), in that it is designed to promote just and equitable
principles of trade and protect investors and the public interest by
fostering an orderly environment on the trading floor. In addition, the
proposal is consistent with section 6(b)(6) of the Act because it would
continue to provide that members of the Exchange be appropriately
disciplined for violations of the rules of the Exchange.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any inappropriate burden on competition.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 35 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) By order approve the proposed rule change, or
(B) Institute proceedings to determine whether the proposed rule
change should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549.
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for inspection and copying at the
Commission's Public Reference Room, 450 Fifth Street, NW., Washington,
DC 20549. Copies of the filing will also be available for inspection
and copying at the principal office of the Phlx. All submissions should
refer to File No. SR-Phlx-94-13 and should be submitted by April 22,
1994.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-7766 Filed 3-31-94; 8:45 am]
BILLING CODE 8010-01-M
